Setup Considerations: Facilities and Administration Costs
You can use this topic to help make decisions when planning your configuration and use of facilities and administration (F&A) costs for competitive awards with cost reimbursable and fixed amount award lines. It explains:
- Why to set them up.
- How they fit into the rest of Workday.
- Downstream impacts and cross-product interactions.
- Security requirements and business process configurations.
- Questions and limitations to consider before implementation.
Refer to detailed task instructions for full configuration details.
What They Are
F&A costs are the indirect costs associated with the administrative operations of an award.
Business Benefits
- Workday automatically calculates F&A costs based on your terms and rates, eliminating the need to calculate the costs manually.
- You can bill and recognize revenue for indirect costs along with the original spends for your award.
- You have the flexibility to waive or override the institutional F&A rate with a new rate.
- You can set a limit on the amount of direct spends that Workday can use to calculate F&A costs on an award line.
Use Cases
- You want to calculate F&A costs for all award spending except lab equipment.
- You want to apply different F&A cost rates for on campus and off campus research.
- You've changed the budget date of the original spend transaction, and need to recalculate the F&A costs at a different cost rate.
- You want to record and bill the sponsor separately for F&A costs and for original spends.
- You want to waive the F&A costs for the sponsor and pay for the costs with funds from your own organizations.
- You want to limit the F&A costs that award subrecipients can request for reimbursement.
Questions to Consider
Question | Considerations |
|---|---|
Which of your spend categories share the same F&A cost rates? | You can map spend categories that share the same F&A cost rate to the same object class.
Workday applies the same F&A rate to all the spends in the same object class. |
How do you determine the F&A cost rate? | You can configure these terms on your award line to determine the rate with which Workday uses to calculate F&A costs:
|
Do you want to apply more than 1 F&A cost rate for the same award? | When you want to apply different cost rates for different periods on the same award, you can use an F&A exception to override the original primary rate. You can also specify cost rates by object classes.
You can waive the original cost rate by applying a new rate for the sponsor and charging the difference to your own organizations. |
Which ledger accounts do you want to post F&A transactions to? | You can create an account posting rule set to specify the ledger accounts for posting F&A costs and revenue recognition transactions. |
How do you want to limit F&A costs in your award? | You can set basis limit on the award line to limit the maximum direct costs that Workday can use to calculate F&A costs.
To limit the amount that subrecipients can charge to your award, you can specify basis limit on the subaward lines. |
Which organizations should pay for F&A costs not covered by your sponsor? | You can distribute F&A costs not covered by your sponsor to 1 or more organizations or funding sources by configuring the F&A waived expense allocation profile. |
How do you want to report on and bill for the F&A costs? | By default, Workday records all F&A costs along with the original spends and you bill for both at the same time. To report and bill F&A costs separately from the original spends, you can configure your company award costs processing rule to override the spend category or object class for F&A. |
Which organizations do you want to allocate F&A revenue to? | You can distribute F&A revenue to 1 or more organizations by configuring an F&A revenue allocation profile.
You can allocate revenue from sponsors or from cost-share funds. |
Recommendations
Configure your company award costs processing rules to:
- Generate award costs at business process completion rather than at settlement, to streamline revenue recognition for your award.
- Override object classes and spend categories for indirect costs, so that you can separate the indirect costs from the direct costs on your sponsor invoices.
Requirements
- Map internal spend categories to sponsor object classes before creating a cost basis type. Workday only calculates F&A costs for spend transactions in the object classes of the cost basis types.
- Include grant worktags on the spend lines that you want to generate F&A costs on. Workday uses the grant worktags on the spend transactions to determine which award line and F&A cost rate to use.
Limitations
You can't use the same F&A exception on more than 1 award.
Tenant Setup
When you reprocess award costs, Workday cancels the previous F&A journal lines and creates new F&A journal lines to replace them. To reverse previous F&A journal lines instead, access the
Edit Tenant Setup - Financials
task and enable the reversal of accounting journals in the Journal Options
section.Security
Configure these domains in the Grants Management functional area:
Domains | Considerations |
|---|---|
Manage: Grant Proposals
Process: Award - Core | Enables you to configure and view:
|
Set Up: Grants Management
| Enables you to configure and view these F&A settings:
|
Business Processes
When you reprocess award costs due to a change in F&A configuration or spend transaction, Workday cancels and replaces previously calculated F&A costs lines, and routes this process to a reviewer for review and approval. You can configure the
Reprocess Award Costs Event
business process to specify who to route the reviews and approvals to.Reporting
Reports | Considerations |
|---|---|
View Accounting for Facilities and Administration
| This report enables you to view the accounting for the F&A costs related to a spend, including the:
You can access this report from the related actions menu of the approved supplier invoices for the original spend. |
View Facilities and Administration Cost Basis Types
| This report enables you to view the cost basis types and object classes in an object class set.
Using this report and the object class map, you can determine the cost basis type for a spend category. |
View Facilities and Administration Exception
| This report enables you to view the details of an exception to an F&A rate agreement. |
View Facilities and Administration Rate Agreement
| This report enables you to view the F&A rate for a location, rate type, and budget start date. |
View Facilities and Administration Revenue Allocation Profile
| This report enables you to view the allocation of F&A revenue and whether there's cost sharing from your own organization. |
View Facilities and Administration Waived Expense Allocation Profile
| This report enables you to view the allocation of waived costs not covered by your sponsor. |
Integrations
Web Services | Considerations |
|---|---|
Get Facilities and Admin Basis Types
Put Facilities and Admin Basis Type | Retrieve, update, or create cost basis types. |
Get Facilities and Admin Cost Rate Type Types
Put Facilities and Admin Cost Rate Type Type | Retrieve, update, or create different F&A cost rate types. |
Get Facilities and Admin Exceptions
Put Facilities and Admin Exception | Retrieve, update, or create exceptions to F&A rate agreements. |
Get Facilities and Admin Object Class Mappings
Put Facilities and Admin Object Class Mapping | Retrieve, update, or create the mappings of internal spend categories to sponsor object classes. |
Get Facilities and Admin Rate Agreements
Put Facilities and Admin Rate Agreement | Retrieve, update, or create F&A rate agreements. |
Get Facilities and Admin Revenue Allocation Profiles
Put Facilities and Admin Revenue Allocation Profile | Retrieve, update, or create profiles to distribute revenue from the sponsor. |
Get Facilities and Admin Waived Expense Allocation Profiles
Put Facilities and Admin Waived Expense Allocation Profile | Retrieve, update, or create profiles to allocate the F&A costs not reimbursable by your sponsor to funds. |
Connections and Touchpoints
Features | Considerations |
|---|---|
Customer Accounts | You can create customer invoices to bill the sponsor for direct and indirect costs for an award. |
Expenses | You can calculate F&A costs on expenses for an award. |
Financial Accounting | You can configure account posting rules to set the ledger accounts for posting F&A journal lines. |
Payroll | You can calculate F&A costs on employee compensation for an award. |
Supplier Accounts | You can calculate F&A costs on supplier invoice lines that contain grant worktags.
You can view the accounting for F&A costs from the original supplier invoices. |
Workday offers a Touchpoints Kit with resources to help you understand configuration relationships in your tenant. Learn more about the Workday Touchpoints Kit on Workday Community.